1. A business paid a dividend last year of $2, and its stock is currently trading at $51 a share. If investors require a rate of return of 11.1, what is the implied growth rate for this company? Show your answer as a percentage to two decimal places.
2. We have two bonds both have coupon rates of 10%, both have a face value of $1,000. The IBM bond has 10 years until maturity. The GE bond has 2 years until maturity. Which has greater interest rate risk?